India could be moving away from its earlier hostile stance towards cryptocurrencies and may soon classify Bitcoin as an asset class, a new report suggests.
Citing anonymous sources tracking the industry, The New Indian Express reported that Securities and Exchange Board of India (SEBI) would oversee regulations for the cryptocurrency sector after Bitcoin gets classified as an asset class.
According to the report, India’s crypto industry is in talks with the Finance Ministry over the formulation of new regulations, adding that an expert panel within the ministry is studying to frame new rules.
In May, the Economic times had reported that the government was forming a new expert panel after prevailing view of earlier recommendations for a blanket ban on the assets was outdated, showing signs of a changing stance within the finance ministry.
The committee is reportedly studying the matter, and a Cryptocurrency Regulation Bill would likely be tabled in the upcoming Monsoon Session of the Parliament.
“We can definitely say that the new committee which is working on cryptocurrencies is very optimistic on cryptocurrency regulation and legislation,” Ketan Surana, Director and chief financial officer, Coinsbit, told the New Indian Express.
Sumit Gupta, Co-founder and CEO of the cryptocurrency exchange CoinDCX, also expressed hope that right crypto regulations would boost the digital economy in India.
“India has so much untapped potential when it comes to the crypto space. With the right crypto regulations, India can become a crypto hub, and lead a digital revolution in India,” Gupta tweeted on Thursday.
India has so much untapped potential when it comes to the crypto space.
With the right crypto regulations, India can become a crypto hub, and lead a digital revolution in India.
— Sumit Gupta (CoinDCX) (@smtgpt) June 10, 2021
On Monday, Nandan Nilekani, co-founder and chair of the IT and consulting company Infosys, urged the Indian government to embrace cryptocurrencies as an asset class.
Speaking to Financial Times, Nilekani said cryptocurrencies are too volatile and energy intensive to be used as a means of payment, however adding that they could be encouraged as an asset that can be “bought and sold, like a commodity.”
“Just like you have some of your assets in gold or real estate, you can have some of your assets in crypto. I think there’s a role for crypto as a stored value but certainly not in a transactional sense,” said the tech executive who has long worked with the Indian government to establish the Aadhar biometric identity program.
After a month of its value plumetting due to a combination of factors, including China’s crackdown on cryptocurrencies, bitcoin has risen since 8 June around the time when El Salvador announced bitcoin would be a legal tender in the country.